Abstract:
In August, the exchange rate of national currency of Azerbaijan-“Manat” beat all historical records. That is to say, the exchange rate was 1 USD= 1.61 Manat in previous month . It should be noted that, the exchange rate hit 1 USD= 1.6 Manat in March, 2016. Since the second half of 2014, due to the fall of oil prices in the world markets there is a visible pressure on the national currency ‘Manat’. Overall, the Azerbaijani “Manat” lost 49.6% of its value in 2015 and in addition, a depreciation of more than 3% in the first 8 months of 2016, the losses could reach 52.2%. Although the occurring rapid dollarization and the observed stagnation in the business environment especially in imports in the first months of 2015 and 2016 resulted in short-term reduction in foreign exchange demand in the March-May period of this year and strengthening the exchange rate of USD/Manat at the level of 1.49, the process of depreciation proceeded again afterwards.

Abstract:
The trade relations between Azerbaijan and the European Union are a substantial part of enhancing economic and political relations among both parties. Recent years have been characterized by an expansion of the trade volume between two parties; the EU turned out to be Azerbaijan’s biggest trade partner, in terms of both imports and exports. Moreover, trade in services and foreign direct investment relations were also on rise. On the other hand, Azerbaijan is one of the main energy suppliers of the European Union among European Neighborhood countries and is a key partner to guarantee energy security.

Abstract:
During the course of 2015 Azerbaijan suffered the impact of two devaluations of the national currency, Azerbaijani Manat (AZN), due to the decrease of the world oil prices. Given that oil and natural gas accounts for more than 90% of Azerbaijani exports, continued low world oil prices had a critical negative impact on the Azerbaijani economy. The current situation has led Azerbaijan to establish new priorities that could help restructure the financial system at this critical moment. The drastic change in the economic outlook of the country has created the need to open a wider window to the European Union (EU) in order to overcome the current economic downturn.